by Media Team
Posted on February 27, 2019 at 04:21 PM
In every business arena, family businesses are truly vital. They are intrinsic boosters of particular region's economy. And when it comes to businesses, challenges are always almost the inescapable phenomena in the form of increased competition, pluralistic social values, transforming global economy, new regulations and so on. Such challenges pose a threat to any family-owned businesses, which gradually affects them. It is therefore crucial to identify and understand the hurdles so that these business owners can actively come up with right ways to overcome them.
Let's see how such family-run businesses face challenges and what are the possible ways to ensure success!
Business demands or family?
Accomplishing proper balance between business needs and familial preference is a must. Quite often, dealing with common business issues like competitions from competitors, technical demands or any urgency in the form of business vis-a-vis familial needs is quite challenging in itself. In such situation, one must deal with extra care as this might have immense effect on overall business environment. Those long-standing family feuds or unresolved conflicts among family will wreck business operations, worsen communication and ultimately results in loss. Some of the important aspects that can help are excellent decision-making, conflict resolution, duly performance management of members of family in line with business needs.
Not only family planning but family business planning!
Some family-run businesses do not have family business planning to cope up with future aspects and unfortunately this results into certain issues like succession planning, finalizing employment policies for members and organising proper mechanism. In a bid to get rid of these drawbacks, building structured planning will not only help the members to keep up with their dedication to business success but also encourage them to abide by values and goals, respectively. In doing so, one would achieve plenty of advantages including improved family relationship, excellent business performance and not to mention the value of trust among one another. Hence, family business planning is vital in creating ownership, fruitful management systems, solid governance and high-yielding business plans.
Passing the legacy of business
Family business transition from one generation to another is quite daunting process. Once the junior member shows readiness to join, he/she must be well-equipped with outside work experience as it is considered a prerequisite. Having such exposure enables one to understand realistic view and also enlightens them on how far their abilities and skills will matter in the business success! What's more, both the generations need to give a scope to different inputs as the young members usually come up with new ideas and latest trends in day-to-day functioning of business. Here, the generation gap should be managed professionally.
Moreover, the junior members should also go through training and development programmes so that they can get along with prevailing modus operandi. Alongside this, a family-run business owners must ensure well in advance regarding who will take over what as this decision is of paramount importance.
No scope for personal feelings. Only business.
One of the biggest challenges family-owned business owners face is to separate their personal feelings from business. For instance, if any member is down due to his personal problem, other members might prefer him to give more flexibility and thus, it massively affects professional decisions. This will also create disturbance in daily operations. And the best way to avoid this situation is by determining to never discuss personal issue during business hours.
Believe it or not, family business-owners rely on the existing new members with an expectation that they will make a difference. This might turn out to be counterproductive as well and negatively affect the development of any business. That's why relying on external professional guidance truly provides competency and right direction which is no less than a boon. At Shareconomy, we provide a wealth of advice and professional services ranging from business formation, acquisitions & restructuring, quality audits, financial due diligence and product development among others.